opinion

Gold falls off $1,850, now what?

Kitco Media
By Jonathan Da Silva
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The bearish short-term probability we discussed yesterday played out overnight, as gold fell while the US dollar index caught a bid coming out of oversold conditions (from within its uptrend channel). The DXY looks ready to make a move up to retest the upper range of the channel, which would likely continue to pressure metals in the short term.

It stands to reason that major U.S. indices would also be subject to pressure as the DXY moves up in the short term. The S&P 500 is approaching the congestion area discussed in prior weeks, which could now be overhead resistance.

Whether the USD is in the process of topping out in the medium to long term remains to be seen, as the major overhead resistance level around 104/5 for the DXY remains intact.

Thanks and have a great day,

Kitco Media

Jonathan Da Silva

Jonathan Da Silva developed a passion for hard money and economics from a young age having been influenced by family who sought to teach me that "nothing is free", and the importance of intrinsic value early on. My interest in markets grew keener during the great financial crisis of 2008; leaning on family with vast trading experience, I began to self-educate on technical analysis and economics- drawing inspiration from the works of individuals like W.D. Gann and Adam Smith. I have been a proud member of the Kitco team since 2017 and hope that my writing inspires readers to consider an objective view of the metals, and the greater financial markets.

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